McMullen v. Ritchie

57 F. 104 | U.S. Circuit Court for the District of Northern Ohio | 1893

RICKS, District Judge.

This case is now before the court upon two motions: First, upon the application of the defendant Samuel J. Ritchie for an order upon the Canadian Copper Company to produce its books, records, and papers for the inspection of said defendant, and to make such parts of it as he may desire to offer testimony in this case;. and, second, upon the application of Sophronia J. Ritchie to be allowed to become a party defendant in this case.

As to the first motion: .This is a bill filed by the complainants, as judgment creditors, against the defendant Samuel J. Ritchie, as judgment debtor, and Stevenson Burke, Henry B. Payne, and the executors of the Cornell estate, as creditors of the judgment debtor, to subject certain stocks and credits which said creditors and co-defendants hold as collateral security for the indebtedness due to them from the judgment debtor. The answers of the defendants Burke, Payne, and the Cornell executors admit that there is a large indebtedness due to them from the judgment debtor, Samuel J. Ritchie. They admit that from time to time said Ritchie has deposited with them, as security for the payment of said indebtedness, a large amount of stocks in various corporations, among which is a, large amount of stock issued by the Canadian Copper Company, in which said judgment debtor and his codefendants are all stockholders. To the answer filed by the executors of the Cornell estate, the defendant Samuel J. Ritchie filed what he terms a cross bill, in which he alleges that his codefendants are so managing the affairs and business of the Canadian Copper Company as to depreciate the value of its stock, and make it valueless as security for the payment of their indebtedness, and for the purpose of injuring said Ritchie. He asks for the privilege of examining the books of said copper company, and the right to inquire into the affairs and management of said corporation. I cannot find any authority for such a proceeding in a suit of this character. The complainants file tbeir bill as judgment creditors, as aforesaid, and have rights which must be respected in the conduct of the case. ÍA11 they seek is their right to subject whatever surplus there may be after the satisfaction of the indebtedness due Burke, Payne, and the Cornell estate to the extinguishment of the judgment which they hold against Bitchie. In determining the amount of this surplus, and in what way it shall be applied to the satisfaction of complainants’ judgment, the judgment debtor, Bitchie, has no right, upon any principle of equity pleading or practice, to bring into this action any controversy he may have with the Canadian Copper Company or with his codefendants as to the corporate management of said company. That is a controversy in which the complainants have no interest. If he could bring into this suit a controversy as to the management of the Canadian Copper Company, he might likewise bring Into the suit a controversy as to the management of every other corporation, the stock of which' is held by his codefendants as similar security. We would thus have injected into this suit several controversies involving the management of several different corporations. In this way, this controversy might be indefinitely prolonged, and the rights of the complainants indefinitely postponed. The defendant has no right, therefore, to bring such controversy into this suit, to delay the final determination of this cause, to the great expense and vexation of the compláinants. If Bitchie has any equitable relief, as against his codefendants, for the improper management of the business of the Canadian Copper Company, his remedy is by an original suit. In such a proceeding, he would be the complainant, and would have a right, if proper grounds for relief are shown, to investigate the books of that concern, and inquire into its management. But he cannot bring into this action such a controversy, which is entirely foreign to the issue properly made between the complainants and the defendants.

The motion of said Bitchie is therefore denied.

IAs to the application of Sophronia J. Bitchie to become a party defendant in this case:

The collateral securities deposited with the defendants Burke, Payne, and the Cornell executors, referred to in the complainants’ bill, and the surplus of which they seek to have applied to the satisfaction of their judgment, are the securities deposited with said defendants by the defendant Samuel J. Bitchie. These securities are set up in the answers filed by his codefendants. They are the only securities involved in this suit, and they are the only securities in the surplus of which the complainants are interested. In the application of Mrs. Bitchie to become a party defendant, she avers that after her husband deposited with the codefendants named the securities referred to in the complainants’ bill, and in the answers of said defendants, she deposited with the said defendants other and additional securities, with her husband’s consent, and at his request. It is for the protection of these securities that she uow asks to be made a defendant in this case. But, as before stated, these securities are not involved in this litigation. The complainants do not seek to have any surplus that may arise from the sale of such securities applied to the extinguishment of their debt. I therefore see no ground upon which Mrs. Ritchie can bring into this controversy any right she may have in those securities. The securities deposited by her husband will be first exhausted and applied to the extinguishment of the complainants’ debt. Should they seek by this or any other proceeding to reach the additional securities deposited by Mrs. Ritchie, it will be time enough then to make her a party, and give her the opportunity to defend the same. But, until the complainants do ask for some relief or remedy as against Mrs. Ritchie and her securities, there is no issue upon which she can properly be made a defendant in this. case.

Her motion is therefore denied.